Ssangyong Motor to Cut 38% of Executives and Further Reduce Wages... Organizational Restructuring Implemented

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[Asia Economy Reporter Ki-min Lee] Ssangyong Motor, which has entered corporate rehabilitation proceedings, announced on the 27th that it has carried out a company-wide organizational restructuring, including slimming down the organization, to establish a foundation for early business normalization.

This organizational restructuring is being conducted to ▲strengthen the response system for corporate rehabilitation proceedings and M&A-related tasks ▲establish a foundation for business normalization through efficient utilization of management resources ▲improve inefficiencies in organizational operations such as new car development.

Ssangyong Motor explained that this restructuring focuses on improving efficiency through unification of management systems, including consolidation of similar organizations for efficient use of human resources, formation of dedicated teams for rehabilitation and M&A-related tasks, and organizational integration for successful new car development and efficient project progress.

Through this restructuring, the previous organization of '9 divisions, 33 departments, and 139 teams' has been reorganized into '7 divisions, 25 departments, and 109 teams,' with a reduction of 2 divisions, 8 departments, and 33 teams.

The number of full-time executives (excluding administrators, registered directors, and outside directors) will also decrease by 38%, from the current level of 26 to 16. Compared to the end of 2019, when serious self-help efforts began (35 executives), this is a 54% reduction.

Full-time executive salaries, which have been cut by 20% compared to 2019, will be further proactively reduced. Moreover, unpaid wages and performance bonuses for executives from January of this year until the 14th of this month, before the rehabilitation order was issued, are also tied up as rehabilitation claims and will be reduced according to the rehabilitation plan in the future.

Ssangyong Motor employees have already been reducing labor costs by approximately 120 billion KRW annually since the end of 2019 through suspension of about 20 welfare items and a 20% wage cut.

Legal administrator Yong-won Jeong said, "We have carried out organizational restructuring to strengthen internal capabilities for thorough implementation of the rehabilitation plan and early business normalization," adding, "Along with the restructuring, the executives' leading by example will serve as a foundation to build consensus among all Ssangyong Motor employees for business normalization."

This content was produced with the assistance of AI translation services.